DISTRIBUTORS PREPARE FOR A CHANGING MARKET IN WASHINGTON

Washington beer and wine wholesalers are preparing for big changes in the state with Gov. Chris Gregoire set to grant legislative alterations to the alcohol industry. Out-of-state breweries and wineries are no longer required to use distributors, and because of an ongoing lawsuit by Costco, the state Liquor Control Board has launched an investigation to decide whether Washington’s regulations are still relevant. However, according to Seattle’s Puget Sound Business Journal, distributors aren’t too worried just yet. “There is the potential for some economic loss for distributors, but it’s really an unknown,” said Phillip Wayt of the Washington Beer and Wine Wholesalers Association. If out-of-state liquor producers opt to self-distribute, wholesalers could see a substantial profit cut whereas small wineries might welcome a distributor’s presence. Dave Marks, co-owner of Cascade Trade Inc., said, “California and Oregon wineries who want to sell directly might find a lot of resistance from (wine) shops and restaurants.” Small wineries will likely need a distributor to get adequate shelf-space in retail, especially when they are dealing with a distant market.